Britain will reject plans announced in Brussels this week to combat industrial-scale tax avoidance by the world’s biggest multinationals, the Treasury minister responsible for tax policy has said.

David Gauke, financial secretary to the Treasury, told representatives from the European parliament that Britain would not adopt the measures to introduce certain common tax rules. “He was very clear that the UK is insisting on tax competition,” said German MEP Michael Theurer, who met with the UK treasury minister on Thursday. “It was really a shock from the minister.”

Theurer is part of a committee of MEPs set up to examine how multinationals are avoiding tax in the EU and what can be done about it. The committee was set up in response to the LuxLeaks revelations of tax avoidance in Luxembourg and its members strongly support the reform plans announced on Wednesday by European commissioner for tax Pierre Moscovici.

Moscovici’s proposals seek to resurrect a longstanding tax harmonisation policy, which has been blocked by hostile member states since 2011.

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